Balancer, the main DeFi protocol, suffered significant abuse, with approximately $116 million drained from the protocol’s vault. On-chain data shows large, unusual outflows from Balancer’s address “0xBA1…BF2C8” to an external wallet, including 6587 WETH (~$24.5M), 6851 osETH (~$26.9M), and 4260 wstETH (~$19.3M). The scale and nature of the transfers point to a coordinated attack involving high-value assets in multiple vaults.
It has been a balancer ever since confirmed breach, stating that “around 7:48 AM UTC, the exploit affected Balancer V2 Composable Stable Pools.” According to the team, these pools have been active for several years, and some have been outside the hiatus window, leaving them vulnerable. Composable pools have been stopped and are now in recovery mode, and the exploit has been confirmed to be isolated to V2 Composable Stable Pools. Balancer V3 and all other pools remain unchanged.
Protocol says it is working with leading security researchers and legal teams on the investigation and will release a full post-mortem. Balancer also warned users about the fake communication that circulated in the aftermath, stressing that official updates would only come through his verified X account and the official Discord.
The incident marks one of the biggest DeFi exploits this year and has raised security concerns across the sector.
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Hacker Shifts Stolen Tokens to ETH as Crypto Markets Face Big Selloff
According to Lookonchain, the Balancer exploiter has started exchange stolen funds for ETH, fueling concerns that the attacker intends to quickly consolidate and move value before defense or recovery mechanisms can be engaged. Converting large amounts of liquid tokens and wrapped assets into ETH not only solidifies the hacker’s control over the stolen funds, but also signals an intention to exit positions entirely rather than negotiate or return the funds — a worrying sign for victims and the protocol.
This development comes during one of the sharpest pullbacks the market has seen in recent months. Ethereum fell below $3,500, a key psychological and technical level, while Bitcoin broke through support at $105,000, reinforcing fears of a deeper decline as liquidity dwindles and sentiment worsens. Altcoins, already under pressure from macro-driven de-risking, are bleeding profusely, capital rotation is halting, and speculative flows are disappearing.
For Balancer, time exacerbates the severity of the crisis. A major security breach during a fragile market period magnifies losses, erodes confidence and increases the risk of liquidity disruption. The DeFi ecosystem is now closely watching both the hackers’ next moves and Balancer’s recovery plan as the sector faces increased technical and sentimental stress.
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BAL breaks further as the market sell-off causes a lot of pressure
BAL has entered another phase of sustained weakness, with the weekly chart showing a clear downtrend that has now intensified following a confirmed exploit. After trading near the $1 region for months, the token has drifted lower, currently hovering around $0.80 and showing a sharp weekly decline. The chart reflects the high volume of sales, suggesting that the security breach accelerated an already fragile market structure.
Technically, BAL remains below the 50-week and 200-week moving averages, reinforcing a long-term bearish trend with no immediate signs of a reversal. Each attempt to establish support was met with lower highs and lows, indicating persistent distribution and a lack of sustained buyer interest. The recent spike in volume during the sell-off confirms capitulation rather than accumulation behavior as fear spreads through the DeFi sector.
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The market sentiment around BAL further worsened with regard to the time of exploitation. With Ethereum trading below $3,500, Bitcoin losing key support near $105,000, and altcoins bleeding everywhere, risk appetite is at a low point. For BAL to show recovery signals, it should regain psychological support near $1 and stabilize volume flows. Until then, price movements remain vulnerable, and further declines cannot be ruled out as confidence is slowly restored.
Featured image from ChatGPT, chart from TradingView.com
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